Boost for hydrogen industry as European Commission okays €900 million French scheme

The European Commission (EC) has approved a €900 million French scheme to support companies investing in the use of biomass and renewable hydrogen in energy and fuel production, to foster the transition towards a net-zero economy.

Courtesy of the European Commission; Credit: Mauro Bottaro

According to the EC, the scheme was approved under the State Aid Temporary Crisis and Transition Framework, adopted by the EC on March 9, 2023, and amended on November 20, 2023, to support measures in sectors that are key to accelerating the green transition and reducing fuel dependencies.

The Commission concluded that the French scheme is necessary, appropriate and proportionate to accelerate the green transition and facilitate the development of certain economic activities, which are of importance for the implementation of the REPowerEU Plan and the Green Deal Industrial Plan.

Under the measure, the aid will take the form of direct grants, covering part of the eligible investment costs, EC said, noting that the aid will incentivise the production of energy and fuel from renewable sources, it will not exceed the maximum aid intensity allowed and will be granted no later than December 31, 2025.

EC further revealed that the measure will be open to new installations and projects that are significantly accelerated or scaled up, adding that projects will have to be completed and put in operation within 36 months from the granting of the aid.

Margrethe Vestager, Executive Vice-President in charge of competition policy, commented: “This €900 million scheme will help companies to increase the use of energy and fuels produced from biomass and renewable hydrogen. By reducing the reliance on imported fossil fuels, it will contribute to the achievement of the EU’s goals. This measure is an important step in the transition to a net-zero economy, while protecting the level playing field in the Single Market.”

In 2024, EC also granted €8.9 million to a new project aiming to establish an advanced green hydrogen valley in Western France. Based in the French Loire Valley, this AdvancedH2Valley project aims to foster the Atlantic area’s energy transition and set the standard for clean, green and renewable hydrogen.

With the EU funding, mainly dedicated to the uses and distribution of hydrogen, the project plans to introduce up to 11.5 MW of new production capacities, in addition to the 1 MW pioneer unit already in operation.

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To note, in 2023, EC approved a €246 million Dutch scheme to support the production of renewable hydrogen and the construction of at least 60 MW electrolysis capacity, a €450 million Italian scheme to support the production of renewable hydrogen, as well as a €170 million Danish scheme to support the production of renewable hydrogen through Power-to-X (PtX) technologies.